Generali is on track to dispose of its Swiss private bank BSI, the Italian insurer’s chief executive said. BSI has expanded significantly in Asia in recent years.

Generali is on track to dispose of its Swiss private bank BSI, the Italian insurer’s chief executive said yesterday. BSI, or Banca della Svizzera Italiana, to call it by its full name, has an important presence in Asia.

Lugano-headquartered BSI has been placed on sale by Generali, along with other businesses owned by the Italian financial services group, as it aims to refocus on insurance and boost profitability.

“We have already disposed of Migdal and have announced processes for the disposal of both Generali US and BSI which are progressing on track,” Mario Greco told an investors’ meeting in London. (Migdal is an insurance and financial services firm in Israel.)

“In all cases when we determine that an asset is not core to our business we will sell only when we are satisfied that the returns we are getting are reasonable. We are not forced sellers of any assets and will not proceed without having certainty of a clear and clean disposal. We expect the total benefit to the business of the disposal of non-core assets, including those already mentioned as well as possible others, will bring in around €4 billion ($5.34 billion) of regulatory capital by end-2015,” he said.

There have been rumours that a sale of BSI could be announced in a matter of days, although Greco did not mention dates.

BSI has seen rapid expansion in Asia. BSI Asia recruited Hanspeter Brunner, formerly the chief executive of RBS Coutts, in October 2009 to head up BSI’s Asian business out of Singapore. Weeks later, he was reunited with over 100 of his former employees from RBS, seen as a sign of BSI’s regional ambitions. In March last year, BSI told this publication of its ambitions to sharply drive up asset and client growth in the Asia-Pacific region from hubs such as Hong Kong and Singapore. (To see that interview, click here.)

Generali targets

In a statement issued earlier today ahead of the investor presentation, Generali said its strategic targets included attaining an operating return on equity of 13 per cent over the cycle, translating into an operating result exceeding €5 billion (around $6.7 billion); a Solvency 1 ratio above 160 per cent by 2015, with an “AA” approach to manage capital and leverage; a cash flow above €2 billion by 2015, and €600 million of cost reduction by end-2015.

Appointments

Meanwhile, Generali said Carsten Schildknecht will join as chief operating officer from 1 April this year. Schildknecht was most recently COO of asset and wealth management and chairman of the supervisory board of Sal Oppenheim, the German wealth management business that was acquired by Deutsche Bank. For eight years, he was also global COO of the wealth management arm of Deutsche Bank.

Generali also said that Nikhil Srinivasan had been named the new group chief investment officer. Srinivasan previously worked in Allianz Group from 2003, holding several investment functions. He has been group CIO of Allianz Investment Management and a member of Allianz’s international executive committee.

In his remarks, Greco said he was encouraged that the €1.25 billion subordinated bond Generali issued on the 5 December last year was “well received”, drawing more than €9 billion of demand with a strong international uptake, of whom 10 per cent were from Asia.